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This is the third year I have been asked by DM Review to write an article on the state of the art of business activity monitoring (BAM). As I began to write this year's article, I struggled to come up with a theme that demonstrates the progress and changes in BAM since last year. On the surface, little has changed, and there is also a perception in some quarters that acceptance of BAM by the industry is waning. Even Gartner Research, the organization that created the BAM concept, admitted at a recent conference that BAM has not taken off as fast as expected. This state of affairs led to the theme for this article, Is BAM Alive and Well? I will review BAM and its business benefits, discuss whether BAM has achieved those benefits and then look at its likely future. As we will see, there is more activity going on in this area than may be apparent - it's just not always called BAM!

What is BAM?

BAM enables organizations to leverage business analytics to gain a real-time insight into daily business operations. This analytical insight helps business users quickly identify operational inefficiencies and predict potential business problems. BAM integrates business intelligence (BI) with business transaction (BTx) processing. It also brings together vendors and IT groups that hitherto have operated in separate IT domains. This can lead to heated debates about the right products to deploy and the use of different terms to describe the same technology concepts.

From a business perspective, it is irrelevant if we use the term BAM or not - it's the business benefits that a technology provides that matter. BAM is often viewed as being associated more with technology infrastructure than business needs. This is why some BAM vendors are now using terms such as operational dashboard builder to describe their products. A dashboard means more to a business manager than an acronym such as BAM. Let's first look, however, at the concepts and objectives behind BAM, and then come back to the terminology issue.

The Emergence of Process-Centric Applications

As I have already stated, BAM is concerned with integrating BI with BTx processing. The BTx applications run business operations, and the BI applications analyze those operations. This combination works particularly well when the applications involved employ a business process-centric view of company operations.

A business process defines the flow of activities that need to be performed to carry out a business operation such as ordering a product, raising a purchase order or processing an insurance claim. Because BTx applications support the main business operations of an organization, we usually associate business processes with BTx applications, rather than BI or collaborative applications. This is why the move toward the use of business process management has seen most growth in the BTx application area.

Business processes and their associated activity workflows, however, can also be used with BI applications. A BI performance management dashboard that displays analytics about business operations could, for example, present a workflow (sometimes called a guided procedure) to business managers to help them investigate specific key performance indicators (KPIs) in more detail. In this case, a business process is added to the BI application.

Another example of adding a process-centric perspective to BI could be when a BTx procurement process detects a delay in a supplier order. The BTx application could invoke a BI service to analyze the financial impact of the delay before sending a message to the procurement manager to notify him/her of the problem. In this case, the BTx process is extended by adding a BI service into the BTx process flow.

We can see from these two examples that a business process can be added to BI, and BI can be added to a business process. Both of these approaches are useful in a BAM environment.

Using BAM

The objective of a BAM project is to monitor, analyze and report on the performance of business operations, and for business users to act on this performance information to improve business operations. Let's examine each of these steps in turn.

Monitoring involves tracking and collecting information about a business operation. Monitoring is easier if the operation being tracked has been implemented in terms of the business activities required to carry out the operation. This granularity enables the monitoring task to track just those activities that are important from a performance perspective. Without this granularity, the monitoring task can only track the complete business operation. A business process and its underlying activities can be implemented using business process management software and an underlying service-oriented architecture (SOA) that defines each business activity as a separate callable service.

The analysis step of BAM processes the information collected by the monitoring step and creates a set of metrics documenting the performance of the monitored business activities. This analysis can be done synchronously and in-line as a part of the main business process, as in the procurement example previously mentioned, or it can be done outside of the main business process. In this latter case, the monitoring information can be routed to an asynchronous in-line process for analysis, or it may be stored in a message queue or persistent store for off-line analysis by an independent application. The method chosen will depend on how quickly the analysis has to be done and acted upon  (i.e., on the timing requirements of the business application).

In-line analysis of monitoring information is supported by several business process management and application integration vendors such as IBM and TIBCO. It is often these vendors that still use BAM terminology. Off-line processing of monitoring information is supported by independent BAM vendors, such as Celequest, and a number of BI vendors. Here, vendors use terms such as operational business performance management and operational dashboard builder, rather than BAM. Operational business performance management and BAM are conceptually the same.